Bursa Malaysia's Earnings Season: Smart Traders Are Already Positioning, Are You?
Bursa Malaysia's Earnings Season: Smart Traders Are Already Positioning, Are You?

Bursa Malaysia's Earnings Season: Smart Traders Are Already Positioning, Are You?

Fri, Jun 6, 2025 3:19 PM

As the 1QCY25 earnings season closes, Bursa Malaysia reveals an increasingly compelling story. While global markets wrestle with uncertainty, many local companies are quietly showing resilience and potential; creating an environment where sharp investors can take advantage before the broader market catches up. 

Market Outlook: Stabilizing at Better Valuations 

The FBM KLCI slipped by 1.76% in the final week of May to 1,508 points, reflecting ongoing foreign fund outflows. Yet, the aggressive buying by local institutions shows that not all investors are pulling back. With the index now consolidating between 1,490 and 1,520, valuation levels have become more appealing, especially for quality names that have delivered solid earnings. For savvy investors, this spells opportunity: the current market is offering entry points that may not last long once sentiment stabilizes. 

Key Sectors Offering a Trading Edge 

Construction: Rebuilding Momentum 

After years of subdued growth, Malaysia’s construction sector is back on the radar. With a steady pipeline of infrastructure projects and fresh land acquisitions, Gamuda Berhad is positioning itself for a multi-year growth cycle. Despite near-term margin pressure, its RM37 billion order book points to robust revenue visibility. Why Traders Should Watch: Gamuda is trading at RM4.59 with Bloomberg consensus target price of RM5.39, offering a potential 17% upside. It’s one of the few large-cap counters tied to real economic recovery. 

Financial Services: Solid Foundations 

Amid softer loan growth, banks like CIMB Group Holdings delivered resilient earnings, supported by stronger trading and fee income. What stands out is CIMB’s 6% dividend yield according to Bloomberg consensus, which offers a cushion in volatile markets. Why Traders Should Watch: CIMB is trading at RM6.85 with a 20% potential upside to RM8.20 (Bloomberg consensus) - a combination of defensive yield and growth prospects that is rare at current valuations. 

Telecommunications: Steady Growth, Big Payoffs Ahead 

Telecoms remain essential, and CelcomDigi Berhad is showing why. The company’s postpaid growth is stable, and the ongoing integration from its merger promises cost synergies worth up to RM800 million a year by 2027. Why Traders Should Watch: At RM3.78, CelcomDigi is heading toward a target of RM4.20 (Bloomberg consensus) an 11% upside, with a defensive profile perfect for volatile markets. 

Utilities: Riding New Demand 

Malaysia’s energy consumption patterns are changing, driven by the rise of data centres and tech industries. Tenaga Nasional Berhad is tapping into this growth, posting a 11% rise in net profit and expanding into non-regulated businesses to boost future earnings. Why Traders Should Watch: Tenaga is priced at RM13.96 with a 15% upside potential toward RM16.07, an attractive setup for investors looking for stable, long-term plays. 

Real Estate Investment Trusts (REITs): Retail Recovery 

Retail REITs like Sunway REIT are benefitting from returning consumer spending. Sunway REIT reported a 20% profit growth YoY, driven by higher foot traffic at Sunway Pyramid and Sunway Carnival. Why Traders Should Watch: While distribution yield of close to 5.3% (Bloomberg consensus), SREITs provide an ideal defensive anchor in a diversified portfolio. 

The Bigger Picture: Why Act Now? 

While the overall results may appear mixed, the absence of major earnings downgrades is a positive signal amid a cautious global backdrop. Key sectors are quietly building momentum, and the current market pullback could provide a timely window for traders looking to reposition into fundamentally strong counters. With valuations becoming more attractive and sectors like construction, banking, and utilities showing resilience, selective stock picking will be crucial for investors aiming to outperform in the coming quarters. 

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The market has already opened the door. it’s time to step through. Happy Trading!